Cadillac (and Its Resale Values) Still Haunted by Troubling Past

Steph Willems
by Steph Willems

The lowly Cimarron might be be a distant, nightmare-fuel memory, but Cadillac’s current sales strategy is still being impacted by a history of not measuring up to European rivals.

The luxury automaker’s newest offerings — the CT6 sedan and XT5 crossover — have been saddled with so-so resale values by residual forecaster ALG, according to Automotive News, making it more difficult for Cadillac to offer competitive lease rates.

Residual values are tied to brand value, and although Cadillac has made big strides in terms of quality and innovation in recent years, the company still hasn’t amassed the resale clout of its German competitors. Incentives aimed at moving slow-selling models out of showrooms haven’t helped, either.

As a result, the residual for the CT6 after 36 months is 46 percent, trailing BMW and Audi, while the XT5’s 54 percent lags behind its closest Lexus competition.

Cadillac President Johan de Nysschen told Automotive News that the company will still be able to offer attractive leases on the new models, but lamented their standing in the eyes of ALG.

“I believe that they should be better,” said de Nysschen, adding that he hopes a smart approach to new car incentives and a better strategy for remarketing used cars will eventually boost Cadillac’s residuals.

The XT5 is Cadillac’s entry in the luxury midsize crossover category, replacing the SRX in that role. That model goes on sale in April, while the competitively priced CT6 flagship should already be rolling into dealerships.

The two introductions follow a bad sales year for Cadillac’s smaller offerings, the ATS and CTS, according to GoodCarBadCar.

Steph Willems
Steph Willems

More by Steph Willems

Join the conversation
4 of 149 comments
  • Speedlaw Speedlaw on Mar 28, 2016

    Just completed the process, so found many, many CTS in the 19-25k window, most off lease. New, close to $50k, just three-four years ago. The Germans and Infiniti keep values longer. The Caddy buyers are old school, trade every three types...more dealer maintained than most brands...the dealers get a lot more churn than other brands, I think.... A lot of these cars are in the 30k mile range-not a lot on the odo compared to lots of other cars I have shopped. You *can* get a $20k ATS but it has that small four. The ATS has no back seat, and I own an e46. The problem with the ATS is that we don't have taxes based on size here, so the ATS just ends up small for no reason. I'm generally not fond of GM's mass market portfolio, especially having just left the NY Auto show, but an off lease Caddy is a great second hand buy, and looks to remain that way !

  • Kmars2009 Kmars2009 on Mar 29, 2016

    After decades of building junk, they can't understand why? PLEASE! They need a reality check.

  • TomLU86 TomLU86 on Mar 29, 2016

    LTD1983 got it right! Cadillacs should be big and powerful! CT6: Does yours have the 4 or 6-cyl? What a bad name to saddle a great car with

  • Fvfvsix Fvfvsix on Mar 29, 2016

    Just about all the comments here have hit the nail on the head. Cadillac isn't making Cadillacs. I would totally plunk down $60K-$70K for a real 'lac. At the moment, the Escalade is the only one that embodies the brand's meaning to most Americans. What they really need right now is a fantastic 3-row Durango-sized ute with a longitudinally mounted small block V8. Make it tow at least 6K, and make it give an X5 a run for its quarter mile time. They'll sell tons. Then, refresh the CT6 lineup with a world-class interior, plush ride, and an LS motor. Give the ATS a back seat. Make the turbo 6 the smallest engine you offer for any car. That will differentiate Cadi's lineup from its competitors in a good way. Unfortunately, after getting a peek into "old" GM, I just don't think the company has what it takes anymore. Most of the people making the decisions really don't care about cars, and that's sad.